| [X]            | Quarterly Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 |
|----------------|-----------------------------------------------------------------------------------------|
|           |                                                                                    |
|           | For the quarterly period ended June 30, 2010                                            |
|           |                                                                                    |
| [  ] | Transition Report pursuant to 13 or 15(d) of the Securities Exchange Act of 1934        |
|           |                                                                                    |
|           | For the transition period from __________ to __________                       |
|           |                                                                                    |
|           | Commission File Number:  333-150692                                           |

| Nevada                                                         | 20-8415633                        |
|----------------------------------------------------------------|-----------------------------------|
| (State or other jurisdiction of incorporation or organization) | (IRS Employer Identification No.) |

| 398 Lemon Creek Dr., Suite A, Walnut, CA 91789 |
|------------------------------------------------|
| (Address of principal executive offices)       |

| (909) 598-0618                                                                     |
|------------------------------------------------------------------------------------|
| (Registrant’s telephone number)                                              |
| _____________________________________________________________________              |
| (Former name, former address and former fiscal year, if changed since last report) |

| [ ] Large accelerated filer[ ] Non-accelerated filer | [ ] Accelerated filer[X] Smaller reporting company |
|------------------------------------------------------|----------------------------------------------------|
|                                                 |                                               |

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Table of Contents

|                                          | TABLE OF CONTENTS                                                                           |   Page |
|-----------------------------------------------|---------------------------------------------------------------------------------------------|------------------|
| PART I – FINANCIAL INFORMATION     |
| Item 1:                                       | Financial Statements                                                                        | 3                |
| Item 2:                                       | Management’s Discussion and Analysis of Financial Condition and Results of Operations | 4                |
| Item 3:                                       | Quantitative and Qualitative Disclosures About Market Risk                                  | 10               |
| Item 4T:                                      | Controls and Procedures                                                                     | 11               |
|  PART II – OTHER INFORMATION  |
| Item 1:                                       | Legal Proceedings                                                                           | 12               |
| Item 1A:                                      | Risk Factors                                                                                | 12               |
| Item 2:                                       | Unregistered Sales of Equity Securities and Use of Proceeds                                 | 12               |
| Item 3:                                       | Defaults Upon Senior Securities                                                             | 12               |
| Item 4:                                       | Submission of Matters to a Vote of Security Holders                                         | 12               |
| Item 5:                                       | Other Information                                                                           | 13               |
| Item 6:                                       | Exhibits                                                                                    | 13               |

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Table of Contents

Item 1.    Financial Statements

| Our financial statements included in this Form 10-Q are as follows:  |
|---------------------------------------------------------------------------|
| F-1                                                                       | Balance Sheets as of June 30, 2010 (unaudited) and December 31, 2009; |
| F-2                                                                       | Statements of Operations for the three and six months ended June 30, 2010 and 2009 (unaudited); |
| F-3                                                                       | Statements of Stockholders’ Equity as of June 30, 2010 (unaudited); |
| F-4                                                                       | Statements of Cash Flows for the six months ended June 30, 2010 and 2009 (unaudited); |
| F-5                                                                       | Notes to Financial Statements. |

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SUNVALLEY SOLAR, INC.

| ASSETS                                                                                                                                   | June 30,2010 |      | December 31,2009 |
|------------------------------------------------------------------------------------------------------------------------------------------|--------------|-----------|------------------|
| CURRENT ASSETS                                                                                                                           | (unaudited)  |      |             |
| Cash and cash equivalents                                                                                                                | $            | 156,609   |             | $ | 309,453 |
| Accounts receivable, net                                                                                                                 |         | 540,518   |             |   | 295,278 |
| Inventory                                                                                                                                |         | 2,821,221 |             |   | 3,344,866 |
| Other receivables                                                                                                                        |         | 46,473    |             |   | 65,378 |
| Prepaid expenses and other current assets                                                                                                |         | 12,647    |             |   | 1,527 |
|                                                                                                                                     |         |      |             |   |   |
| Total current assets                                                                                                                     |         | 3,577,468 |             |   | 4,016,502 |
|                                                                                                                                     |         |      |             |   |   |
| PROPERTY AND EQUIPMENT, NET                                                                                                              |         | 50,689    |             |   | 56,853 |
|                                                                                                                                     |         |      |             |   |   |
| OTHER ASSETS                                                                                                                             |         |      |             |   |   |
| Other assets                                                                                                                             |         | 18,686    |             |   | 16,936 |
|                                                                                                                                     |         |      |             |   |   |
| Total other assets                                                                                                                       |         | 18,686    |             |   | 16,936 |
|                                                                                                                                     |         |      |             |   |   |
| TOTAL ASSETS                                                                                                                             | $            | 3,646,843 |             | $ | 4,090,291 |
|                                                                                                                                     |         |      |             |   |   |
| LIABILITIES AND STOCKHOLDERS' EQUITY                                                                                                     |         |      |             |   |   |
|                                                                                                                                     |         |      |             |   |   |
| CURRENT LIABILITIES                                                                                                                      |         |      |             |   |   |
| Accounts payable and accrued expenses                                                                                                    | $            | 3,243,499 |             | $ | 3,405,207 |
| Accrued warranty                                                                                                                         |         | 24,436    |             |   | 22,833 |
| Current portion of long-term debt                                                                                                        |         | 11,541    |             |   | 8,178 |
| Short-term notes payable                                                                                                                 |         | 160,000   |             |   | - |
| Notes payable to related party                                                                                                           |         | 175,000   |             |   | 175,000 |
| Customer deposits                                                                                                                        |         | 117,403   |             |   | 93,555 |
|                                                                                                                                     |         |      |             |   |   |
| Total current liabilities                                                                                                                |         | 3,731,879 |             |   | 3,704,773 |
|                                                                                                                                     |         |      |             |   |   |
| LONG-TERM LIABILITIES                                                                                                                    |         |      |             |   |   |
| Notes payable                                                                                                                            |         | 82,309    |             |   | 91,822 |
|                                                                                                                                     |         |      |             |   |   |
| Total long-term liabilities                                                                                                              |         | 82,309    |             |   | 91,822 |
|                                                                                                                                     |         |      |             |   |   |
| TOTAL LIABILITIES                                                                                                                        |         | 3,814,188 |             |   | 3,796,595 |
|                                                                                                                                     |         |      |             |   |   |
| STOCKHOLDERS' EQUITY                                                                                                                     |         |      |             |   |   |
|                                                                                                                                     |         |      |             |   |   |
| Common stock, $0.001 par value, 1,000,000,000 shares authorized, 800,068,420 and 483,095,478 shares issued and outstanding, respectively |         | 800,069   |             |   | 483,096 |
| Additional paid-in capital                                                                                                               |         | (123,288) |             |   | 393,685 |
| Retained earnings (deficit)                                                                                                              |         | (844,126) |             |   | (583,085) |
|                                                                                                                                     |         |      |             |   |   |
| Total Stockholders' Equity                                                                                                               |         | (167,345) |             |   | 293,696 |
|                                                                                                                                     |         |      |             |   |   |
| TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                                                                                          | $            | 3,646,843 |             | $ | 4,090,291 |

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SUNVALLEY SOLAR, INC.

|                                                        | For the Three Months EndedJune 30, |        |   | For the Six Months EndedJune 30, |
|-------------------------------------------------------------|------------------------------------|-------------|--------|----------------------------------|
|                                                        | 2010                               |        |   | 2009                             |   |   | 2010 |   |   | 2009 |
|                                                        |                               |        |   |                             |   |   |   |   |   |   |
| REVENUES                                                    | $                                  | 1,303,521   |   |                             | $ | 1,243,865 |   |   | $ | 2,071,167 |   |   | $ | 1,598,579 |
| COST OF SALES                                               |                               | 1,160,030   |   |                             |   | 1,018,936 |   |   |   | 1,779,297 |   |   |   | 1,319,564 |
| GROSS PROFIT                                                |                               | 143,491     |   |                             |   | 224,929 |   |   |   | 291,870 |   |   |   | 279,015 |
|                                                        |                               |        |   |                             |   |   |   |   |   |   |   |   |   |   |
| OPERATING EXPENSES                                          |                               |        |   |                             |   |   |   |   |   |   |   |   |   |   |
| Salary and wage expense                                     |                               | 91,917      |   |                             |   | - |   |   |   | 252,036 |   |   |   | - |
| Bad debt expense                                            |                               | -           |   |                             |   | - |   |   |   | 65,000 |   |   |   | - |
| Selling, general and administrative expenses           |                               | 228,840     |   |                             |   | 244,097 |   |   |   | 228,398 |   |   |   | 516,264 |
|                                                        |                               |        |   |                             |   |   |   |   |   |   |   |   |   |   |
|      Total operating expenses      |                               | 320,757     |   |                             |   | 244,097 |   |   |   | 545,434 |   |   |   | 516,264 |
|                                                        |                               |        |   |                             |   |   |   |   |   |   |   |   |   |   |
| INCOME (LOSS) FROM OPERATIONS                               |                               | (177,266    | )      |                             |   | (19,168 | ) |   |   | (253,564 | ) |   |   | (237,249) |
|                                                        |                               |        |   |                             |   |   |   |   |   |   |   |   |   |   |
| OTHER INCOME (EXPENSES)                                     |                               |        |   |                             |   |   |   |   |   |   |   |   |   |   |
| Other income                                                |                               | 438         |   |                             |   | 216 |   |   |   | 1,700 |   |   |   | 576 |
| Interest income (expense), net                              |                               | (7,561      | )      |                             |   | (6,088 | ) |   |   | (9,177 | ) |   |   | (8,545) |
|                                                        |                               |        |   |                             |   |   |   |   |   |   |   |   |   |   |
|      Total other income (expenses) |                               | (7,123      | )      |                             |   | (5,872 | ) |   |   | (7,477 | ) |   |   | (7,969) |
|                                                        |                               |        |   |                             |   |   |   |   |   |   |   |   |   |   |
| INCOME (LOSS) BEFORE TAXES                                  |                               | (184,389    | )      |                             |   | (25,040 | ) |   |   | (261,041 | ) |   |   | (245,218) |
|                                                        |                               |        |   |                             |   |   |   |   |   |   |   |   |   |   |
| Provision for income taxes                                  |                               | -           |   |                             |   | - |   |   |   | - |   |   |   | - |
|                                                        |                               |        |   |                             |   |   |   |   |   |   |   |   |   |   |
| NET INCOME (LOSS)                                           | $                                  | (184,389    | )      |                             | $ | (25,040 | ) |   | $ | (261,041 | ) |   | $ | (245,218) |
|                                                        |                               |        |   |                             |   |   |   |   |   |   |   |   |   |   |
| INCOME (LOSS) PER SHARE                                     |                               |        |   |                             |   |   |   |   |   |   |   |   |   |   |
| Basic and diluted                                           | $                                  | (0.00       | )      |                             | $ | (0.00 | ) |   | $ | (0.00 | ) |   | $ | (0.00) |
| WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING               |                               |        |   |                             |   |   |   |   |   |   |   |   |   |   |
| Basic and diluted                                           |                               | 504,213,810 |   |                             |   | 484,813,591 |   |   |   | 493,439,803 |   |   |   | 484,813,592 |

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SUNVALLEY SOLAR, INC.

|                                            | Common Stock |        |   | Additional |   |    | Accumulated     |   |   |     |
|-------------------------------------------------|--------------|-------------|--------|------------|--------|---------|-----------------|--------|--------|----------|
|                                            | Shares       |        |   | Amount     |   |    | Paid-In Capital |   |   | Deficit  |   |   | Total |
|                                            |         |        |   |       |   |    |            |   |   |     |   |   |   |
| Balance at December 31, 2008                    |         | 484,813,592 |   |       | $      | 484,814 |            |   | $      | 391,967  |   |   | $ | 4,774 |   |   | $ | 881,555 |
|                                            |         |        |   |       |   |    |            |   |   |     |   |   |   |   |   |   |   |   |
| Retirement of common stock                      |         | (1,718,114  | )      |       |   | (1,718  | )               |   |   | 1,718    |   |   |   |   |   |   |   |   |
| Net loss                                        |         | -           |   |       |   | -       |            |   |   | -        |   |   |   | (587,859 | ) |   |   | (587,859) |
|                                            |         |        |   |       |   |    |            |   |   |     |   |   |   |   |   |   |   |   |
| Balance at December 31, 2009                    |         | 483,095,478 |   |       |   | 483,096 |            |   |   | 393,685  |   |   |   | (583,085 | ) |   |   | 293,696 |
|                                            |         |        |   |       |   |    |            |   |   |     |   |   |   |   |   |   |   |   |
| Repurchase of common stock                      |         | (3,054,425  | )      |       |   | (3,054  | )               |   |   | (196,946 | ) |   |   | - |   |   |   | (200,000) |
|                                            |         |        |   |       |   |    |            |   |   |     |   |   |   |   |   |   |   |   |
| Recapiltalization                               |         | 320,027,367 |   |       |   | 320,027 |            |   |   | (320,027 | ) |   |   | - |   |   |   | - |
|                                            |         |        |   |       |   |    |            |   |   |     |   |   |   |   |   |   |   |   |
| Net loss for the six months ended June 30, 2010 |         | -           |   |       |   | -       |            |   |   | -        |   |   |   | (261,041 | ) |   |   | (261,041) |
|                                            |         |        |   |       |   |    |            |   |   |     |   |   |   |   |   |   |   |   |
| Balance at June 30, 2010                        |         | 800,068,420 |   |       | $      | 800,069 |            |   | $      | (123,288 | ) |   | $ | (844,126 | ) |   | $ | (167,345) |

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SUNVALLEY SOLAR, INC.

|                                                                                     | For the Six Months EndedJune 30, |
|------------------------------------------------------------------------------------------|----------------------------------|
|                                                                                     | 2010                             |   |   | 2009 |
|                                                                                     |                             |   |   |   |
| OPERATING ACTIVITIES:                                                                    |                             |   |   |   |
| Net income (loss)                                                                        | $                                | (261,041 | ) |   | $ | (245,218) |
| Adjustments to reconcile net income (loss) to net cash provided by operating activities: |                             |   |   |   |   |   |
| Depreciation and amortization                                                            |                             | 6,548 |   |   |   | 11,007 |
| Stock-based compensation                                                                 |                             | - |   |   |   | 113,966 |
| Changes in operating assets and liabilities:                                             |                             |   |   |   |   |   |
|    (Increase) decrease in accounts receivable                             |                             | (245,240 | ) |   |   | (50,448) |
|    (Increase) decrease in inventory                                       |                             | 523,645 |   |   |   | (321,583) |
|    (Increase) decrease in prepaid expenses and other assets               |                             | (11,120 | ) |   |   | (247,141) |
|    (Increase) decrease in other receivable                                |                             | 18,905 |   |   |   | 1,588 |
|    (Increase) decrease in deferred financing costs                        |                             | - |   |   |   | 32,219 |
|    Increase (decrease) in accounts payable and                            |                             |   |   |   |   |   |
| accrued warranty expenses                                                                |                             | (160,105 | ) |   |   | (66,200) |
|    Increase (decrease) in other assets                                    |                             | (1,750 | ) |   |   |   |
|    Increase (decrease) in customer deposits                               |                             | 23,848 |   |   |   | 23,106 |
|                                                                                     |                             |   |   |   |   |   |
| Net Cash (Used) in Operating Activities                                                  |                             | (106,310 | ) |   |   | (748,704) |
|                                                                                     |                             |   |   |   |   |   |
| INVESTING ACTIVITIES:                                                                    |                             |   |   |   |   |   |
|                                                                                     |                             |   |   |   |   |   |
| Purchase in property and equipment                                                       |                             | (384 | ) |   |   | (61,162) |
|                                                                                     |                             |   |   |   |   |   |
| Net Cash (Used) in Investing Activities                                                  |                             | (384 | ) |   |   | (61,162) |
|                                                                                     |                             |   |   |   |   |   |
| FINANCING ACTIVITIES:                                                                    |                             |   |   |   |   |   |
| Proceeds from related party notes payable                                                |                             | - |   |   |   | 1,163,000 |
| Repayment of related party notes payable                                                 |                             | (6,150 | ) |   |   | (964,820) |
| Proceeds from issuance of common stock, net                                              |                             | - |   |   |   | 588,281 |
| Repurchase of common stock                                                               |                             | (40,000 | ) |   |   | (452,000) |
| Collection of related party receivables                                                  |                             | - |   |   |   | 31,129 |
|                                                                                     |                             |   |   |   |   |   |
| Net Cash Provided by Financing Activities                                                |                             | (46,150 | ) |   |   | 365,590 |
|                                                                                     |                             |   |   |   |   |   |
| NET DECREASE IN CASH                                                                     |                             | (152,844 | ) |   |   | (444,276) |
| CASH AT BEGINNING OF YEAR                                                                |                             | 309,453 |   |   |   | 564,432 |
|                                                                                     |                             |   |   |   |   |   |
| CASH AT END OF YEAR                                                                      | $                                | 156,609 |   |   |   | 120,156 |
|                                                                                     |                             |   |   |   |   |   |
| SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:                                       |                             |   |   |   |   |   |
|                                                                                     |                             |   |   |   |   |   |
| CASH PAID FOR:                                                                           |                             |   |   |   |   |   |
| Interest                                                                                 | $                                | 9,177 |   |   | $ | 11,862 |
| Income taxes                                                                             | $                                | 800 |   |   | $ | 800 |
| Recapitalization                                                                         |                             | 16,764 |   |   |   | - |
|                                                                                     |                             |   |   |   |   |   |
| NON-CASH INVESTING AND FINANCING ACTIVITIES                                              | $                                | - |   |   | $ | - |

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SUNVALLEY SOLAR, INC. 

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SUNVALLEY SOLAR, INC. 

| ·   | Zhijian (James) Zhang, President and Chief Executive Officer |
|--------------------|--------------------------------------------------------------|

| ·   | Mandy Chung, Chief Financial Officer, Secretary, and Treasurer |
|--------------------|----------------------------------------------------------------|

| ·   | Hangbo (Henry) Yu, General Manager |
|--------------------|------------------------------------|

| ·   | Fang Xu, Chief Technology Officer |
|--------------------|-----------------------------------|

| ·   | Shirley Liao, Director of Administration |
|--------------------|------------------------------------------|

| ·   | All directors hold office for one-year terms until the election and qualification of their successors. Officers are elected by the board of directors and serve at the discretion of the board. |
|--------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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Item 2.     Management’s Discussion and Analysis or Plan of Operation

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| ·   | Solar Systems Design and Installation |
|--------------------|---------------------------------------|

| ·   | Solar Technology Research and Development |
|--------------------|-------------------------------------------|

| ·   | Solar Equipment Manufacturing and Distribution |
|--------------------|------------------------------------------------|

| ·   | Roof Top Power Plant Projects |
|--------------------|-------------------------------|

| ·   | Developing and commercializing our proprietary solar technologies including our coating and focusing technologies, racking and panel cleaning system. By deploying these new technologies into our photovoltaic (“PV”) panels and solar installation business, we hope to enhance the value provided to our customers and increase our profitability. |
|--------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Promoting and enhancing our company’s brand and reputation in solar design and integration and expanding our installation business from Southern California to Northern California, Arizona or other states. |
|--------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Developing a PV panel manufacturing capability to provide high efficiency and low cost solar panels to US market. This will complement our installation business and provide an implementation platform for our R&D. |
|--------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Getting involved in the private power providing business (Roof-top Power Plants).  Developing this line of business will lead to higher profit margins and income to our business. In the future, this line of business could become one of our main income sources. |
|--------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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| ·   | Set-up a platform to showcase our innovative solar panel technologies and make Sunvalley solar panels a household name. |
|--------------------|-------------------------------------------------------------------------------------------------------------------------|

| ·   | Penetrate into the main stream distribution network |
|--------------------|-----------------------------------------------------|

| ·   | Further sale activities |
|--------------------|-------------------------|

| ·   | Offer a low cost, high efficiency solar panel derived from advanced research |
|--------------------|------------------------------------------------------------------------------|

| ·   | Registration and Certification of OEM panels with our brand – $300,000, including UL certification fees, CEC registration fees, and lab testing fees. |
|--------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Initial Inventory – $1,500,000.  We will need to keep at least 4 containers of PV panels in the warehouse in order to support sales of 5~10M watts per year, which means we will need to have over $1,000,000 in inventory for PV panels only. An additional $300,000 in inventory would be needed in order to keep the requisite amount of inverters and racking and panel cleaning systems. In addition, we anticipate providing variable payment terms to different customers based on their creditworthiness; this will add additional cash flow pressure. |
|--------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | OEM Management costs – $200,000 |
|--------------------|---------------------------------------|

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| Initiate OEM Manufacturing                          | $2,000,000 |
|-----------------------------------------------------|------------|
| R&D Commercialization Costs                     | $500,000   |
| Expansion of Installation Business (3 new branches) | $1,500,000 |
| Additional working capital and general corporate    | $500,000   |
| Total capital needs                                 | $4,500,000 |

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Item 3.     Quantitative and Qualitative Disclosures About Market Risk

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Item 4T.     Controls and Procedures

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Table of Contents

Item 1.     Legal Proceedings

Item 1A.  Risk Factors

Item 2.     Unregistered Sales of Equity Securities and Use of Proceeds

Item 3.     Defaults upon Senior Securities

Item 4.     Submission of Matters to a Vote of Security Holders

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Item 5.     Other Information

Item 6.      Exhibits

| ExhibitNumber |  Description of Exhibit                                                                                                                                                  |
|---------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 3.1           | Articles of Incorporation (1)                                                                                                                                                 |
| 3.2           | Bylaws (1)                                                                                                                                                                    |
| 31.1          | Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002                             |
| 31.2          | Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002                             |
| 32.1          | Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 |

| 1   | Incorporated by reference to Registration Statement on Form S-1 filed May 7, 2008. |
|---------------|------------------------------------------------------------------------------------|

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|   | Sunvalley Solar, Inc.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
| Date:  | August 23, 2010                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
|   | By:       /s/ Zhijian (James) Zhang                                                                             Zhijian (James) ZhangTitle:    Chief Executive Officer and Director |